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Memo
<br /> To: Mayor and City Council 12. C_
<br /> Bill Malinen,City Manager 6.t10 t (
<br /> From: Chris Miller,Finance Director
<br /> Date: January 6,2011
<br /> Re: Summary of City Cash Reserves
<br /> Introduction
<br /> The purpose of this memo is to provide a summary of the City's current reserve levels, as well as
<br /> an overview on why the City maintains cash reserves.
<br /> Reserves are oftentimes referred to as cash, rainy day funds, contingency funds, or fund balance.
<br /> In many instances these terms can be used interchangeably. However, for purposes of this
<br /> discussion we'll refer to them as `cash reserves' - or monies that the City can draw upon to
<br /> provide for, day-to-day operations, capital replacements, one-time expenditures, or unforeseen
<br /> circumstances. One further distinction is made with regard to the City's cash reserves. All
<br /> municipalities are required to distinguish between restricted reserves and unrestricted reserves.
<br /> These are described in further detail below.
<br /> Current Cash Reserve Levels
<br /> The following table depicts the City's current reserve levels as of 12/31/09 (the last year for
<br /> which audited financial statements are available)for key operating funds:
<br /> Target Actual $$Over $$Amount
<br /> Fun 2ffl2 Pct. Ea (Under) Unrestricted
<br /> General $ 3,646,052 50% 32% $ (2,068,611) $ 3,171,949
<br /> Parks&Recreation 449,653 25% 13% (426,767) 449,653
<br /> Community Development 339,891 40% 28% (150,315) -
<br /> Communications 276,516 20% 93% 216,864 -
<br /> Information Technology - 20% 0% (169,238) -
<br /> License Center 335,843 20% 34% 140,757 -
<br /> Water - 50% 0% (2,699,975) -
<br /> Sanitary Sewer 2,821,658 50% 80% 1,061,375 -
<br /> Storm Sewer 2,392,916 50% '►282% 1,968,170 -
<br /> Recycling - 50% 0% (247,859) -
<br /> Golf Course $ 394,557 50% 124% $ 235,112 $ 394,557
<br /> Total $ 10,657,086 $ (2,140,487) $ 4,016,159
<br /> The City has approximately $.1-0:6"million in cash reserves in its key operating funds — funds
<br /> used to provide for day-to-day activities. However, as is shown in the above table, only $4
<br /> million is unrestricted and therefore available for any lawful purpose.
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